Hypo Real Estate
Hypo Real Estate is the second largest lender in Germany. In late September, 2008, the group faced eminent failure, resulting from short-term refinancing. The European Union put together a consortium of banks with a rescue sum of €35 billion on October 2, 2008, to cover loan guarantees until April 2009.1
The bailout collapsed on October 4, 2008, when private investors withdrew their support because of undisclosed funding issues.2 German chancellor Angela Merkel promised on October 5, 2008, to assist the ailing lender, concerned that the failure would contribute to the expanding European Bank Crisis.3
Fast Facts
- Hypo Real Estate has €400 billion in assets2
- €65 billion of that is in commercial properties spread over 30 countries2
- On Sunday, October 5, German chancellor Angela Merkel promised to guarantee all private savings accounts, a total of some €500 billion (or more than $700 billion)4
Quotes
We will have to start over again from last weekend's meetings. Hypo Real Estate has to be stabilized otherwise the damage would be unpredictable. -- German Finance Minister Peer Steinbrueck3
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